Fisker's stock fell over 40% in after-hours trading on Wednesday, further escalating investor anxiety over the electric vehicle (EV) company's long-term viability.
Fisker Prepares for Possible Bankruptcy Filing
The Wall Street Journal, citing people familiar with the matter, reported Wednesday that Fisker allegedly hired restructuring experts in preparation for a possible bankruptcy filing.
Before this, Fisker expressed concern about not having enough money to survive another year. CNN reported that the automaker had already voiced worries over its capacity to remain in business after releasing the results report for 2023's fourth quarter in February.
During that period, Fisker noted that it was in talks with an existing investor about raising more capital to sustain the firm. Also, in an effort to reduce expenses, the carmaker announced that 15% of its employees would be let go.
Fisker Business Plan
As part of its unconventional business plan, Fisker has outsourced the production of its product, the Ocean electric SUV, to a third party. Magna, an Austrian manufacturer that has worked for Jaguar, Mercedes-Benz, and BMW before, is now responsible for the Ocean's production.
Magna built over 10,193 Fisker SUVs last year, but the EV maker already disclosed that less than half of them were delivered to consumers within the calendar year. Fisker expects 20,000 deliveries this year.
A month ago, American YouTuber Marques Brownlee caused a stir online by posting a video titled "This is the Worst Car I've Ever Reviewed" on his channel criticizing Fisker's Ocean model.
More than 4.5 million people have seen Brownlee's video, which caused the stock to drop shortly after it came out. At Wednesday's market closure, Fisker shares were trading at 32 cents each, down more than 80% since the beginning of 2024.
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